Determinants of Strategy Implementation among Savings and Credit Co-operative Societies in Kenya

Abstract

Savings and credit cooperative societies (SACCOs) in are regulated by SACCO regulatory authority for deposit taking business. The licensed deposit taking SACCOs in Kenya play an important role in provision of financial services to its members. The study sought to establish determinants of strategy implementation among SACCOs in Kenya, specifically the influence of strategic, organization capability, innovation, and organization environment among SACCOs in Kenya. To conceptualize strategy implementation the study was guided by the following theories: Higgins 8s model, resource based view theory, contingency leadership theory, diffusion of innovation theory, and open system theory. The study applied cross-sectional research design employing survey strategy. The research methodologies were both quantitative and qualitative. The target population was all the 176 Deposit Taking Licensed SACCOs in Kenya. Simple random sampling and application of Nassiuma formula was utilized to draw a sample 64 Deposit Taking SACCOs in Kenya. Purposive sampling was used to pick one officer from each management levels from sample, where the level of management categories included: top level management, middle level management, and lower level management of the SACCO who are deemed to be concern with strategy implementation. The data were collected using questionnaires with open and closed ended questions. The data collected were analyzed utilizing descriptive and inferential statistics. The qualitative data was analyzed by use of content analysis. The descriptive analysis entailed graphs, tables, frequencies, and chi-square. The inferential analysis on the other hand involved testing significant linear relationship between the dependent and the independent variables. The inferential analysis involved Pearson correlation and regression analysis while analysis of variance (ANOVA) was used to test hypothesis. Diagnostic tests were also carried out to test regression assumption. The tests were normality test, multicollinearity test, and heteroscedasticity test. Statistical package of social sciences (SPSS Version 20) was utilized in both descriptive and inferential analysis. Factor analysis was used after successful testing of validity and reliability using the results of Kaiser-Meyer-Olkin measure of sampling adequacy and Bartlett’s Test of Sphericity. From the study findings, the study concluded that the three independent variables (strategy leadership, innovation, and organization environment) had positive significant relationship among SACCOs in Kenya. That improvement in strategic leadership, innovation, and organization environment would lead to improvement in strategy implementation among SACCOs in Kenya. Organization capability and strategy implementation had no significant relationship which indicated that improvement in organization capability would lead to an adverse drop in improvement of strategy implementation among SACCOs in Kenya. The study recommends that SACCOs need to improve strategic leadership commitment to strategy implementation. The study also recommends that SACCO management need to ensure the sustainability of innovation, while appreciating organization capability for business improvement. Further, the study recommended that SACCOs ought to adapt to changes in the environment for business survival. Future studies ought to explore other vital areas which include motivation decision making and customer satisfaction while, considering other data collection instrument which may include secondary data, focus group discussions and interviews.